Re Vesey, deceased

• Jurisdiction: Ireland
• Judgment Date: 01 January 1958
• Docket Number: [1956. No. 2131]
• Date: 01 January 1958
• Court: High Court

In re Vesey

deceased

Direction to set aside and invest a sum yielding an annuity to be paid free of income tax - How capital sum to be calculated - Whether annuitant entitled to resort to capital sum - Whether annuitant obliged to account to trustees in respect of repayments of income tax - Extent of such obligation - Powers of trustees in regard to investment of capital sum - Right of annuitant to have deficiencies met from fund consisting of accumulations of income and refunds of income tax.

A testatrix directed her trustees "to set aside and invest such sum of money as will produce the sum of one pound a week free of income tax and they shall pay this sum monthly to my nephew Cyril Power (son of my brother Richard Power) . . . for the term of his natural life, first payment thereof to be made one month after my death and after the death of Cyril Power they shall pay and transfer the said sum of money to his son . . . for his own use and benefit absolutely." Heldby Budd J., 1, that the capital sum required to be set aside should be computed as of the date of the death of the testatrix; income tax at the rate prevailing at that date being utilised for the purpose of calculation; 2, that as the gross annual sum required to produce a weekly sum of one pound, after deduction of income tax at the relevant rate would be £83 4s. 0d., the gift should be construed as a gift of an annual sum of £83 4s. 0d., and the capital sum to be set aside and invested should be such sum as would produce such gross amount; 3, that the capital sum to be set aside and invested should be computed on the basis of ascertaining the sum which, if invested in two and one half per cent. Consols at the price and rate of interest prevailing at the date of the death of the testatrix, would produce an annual income of £83 4s. 0d.Prendergast v. Prendergast and Others, 3 H.L. Cas. 195 followed; 4, that the annuitant would not be entitled to resort to...